Room Configuration - Are Your Rooms Configured for the Best and Highest Use?
By Brenda Fields Founder, Fields & Company | October 28, 2008
"Build it and they will come" may work in The Field of Dreams, but in the hotel industry, the more accurate sentiment may be "Build it RIGHT and they will come". To realize the highest room sales potential, it is important for owners and managers to make sure that each room is configured to its highest and best use. Many times, with very little expense, room revenues are significantly impacted through occupancy and/or average rate increases, by making minor adjustments. This is especially true in the case of small, boutique hotels, where each room sold has a significant financial impact.
By understanding and implementing a few basic principals, owners and managers can potentially avoid costly miscalculations in revenues and expenses by building it correctly or by reconfiguring an existing property. Some basic principals are:
Know your targeted market(s), i.e. who they are and what they expect
Sometimes, by trying to be all things to all people, the room product becomes diluted, and does not satisfy the need of the core market, resulting in an underperforming hotel. For example, upon new ownership of a high-end, all-suite hotel in West Hollywood, California, it was observed that the large suites had twin beds and the small suites had king beds. The core market was entertainment groups, typically comprised of a lead singer and his/her band. The original room configuration was based on accommodating several guests in the larger suites, which is why there were more beds. But, the core business required the larger suite for the lead performer who expected a king bed. The price sensitive groups would double up to save money. By switching the king beds with the twin beds, and charging accordingly, the hotel was able to capture its core business, impacting occupancy and average rates.
Another example of ineffective planning is that of an urban hotel in a prime corporate transient business location, with enough roomnight potential to fill the hotel three to four days per week. During renovation upon new ownership, all of the guest rooms were changed to connecting rooms, with the idea that this would appeal to families. Additionally, microwave ovens placed in each room for families, but high speed internet access was only available through the business center. As a result, families did not stay the hotel because the rates were above their budgets. The individual business traveler would not stay in the connecting rooms because of noise and lack of privacy, as well as the lack of in-room business amenities. By not recognizing the core market, and by not understanding the needs of that market, the hotel failed to attract the high rated business on which all their proformas were based, despite their location advantage and other strong competitive advantages. The wrong room product was created ad there was ample supply among the competition to meet the needs of the two markets.
Quantify the mix of business